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T-Mobile Ends Contracts and Subsidies 404

Posted by Soulskill
from the reducing-complexity dept.
AlphaWolf_HK writes "In what I see as a refreshing change, T-Mobile, the fourth largest carrier in the U.S., has made sweeping changes to its service, ending both phone subsidies and service contracts. Its CEO said, 'Here's the deal: If we suck this month, go somewhere else. If we're good, stay with us.' As part of that change, the new base plan will include unlimited access, including voice, text, and data. Data will be restricted to edge speeds after 500MB with no overage costs, but can be upgraded to 2.5GB for $10, or unlimited for $20. Portable Wi-Fi hotspot usage is also unrestricted for no additional cost. In addition, LTE services just went live in eight markets. As is already standard practice with T-Mobile, you are free to bring your own device. To keep customers from having to front the full cost of the phone with unsubsidized plans, they'll let people pay off phones in installments. They're also getting the iPhone 5 next month for $650."
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T-Mobile Ends Contracts and Subsidies

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  • They get it (Score:5, Insightful)

    by SgtKeeling (717065) on Tuesday March 26, 2013 @05:45PM (#43285795) Journal
    It sounds like T-Mobile is going to be offering reasonable, attractive cell phone plans. Wow. I'm genuinely surprised that such a large carrier is moving in this direction. Good on them.
  • awesome! (Score:3, Insightful)

    by Anonymous Coward on Tuesday March 26, 2013 @05:46PM (#43285801)
    The best plans, the best prices, the best phones, and the hottest spokesgirl.
  • Re:They get it (Score:4, Insightful)

    by Capt.DrumkenBum (1173011) on Tuesday March 26, 2013 @05:54PM (#43285873)
    Sounds like a company that is going to pick up a lot of customers very quickly.
    Up here in Vancouver Canada there are really only two carriers. Rogers/Fido or Bell/Telus. Wind is here also, but they seem like they are flailing.
    Maybe there will be something useable by October when my contract with Bell ends.
    Useable = Unlimited TXT, a whack of data, call display, and maybe 200 minutes a month. For less than $90 a month.
  • They are forced to (Score:4, Insightful)

    by Anonymous Coward on Tuesday March 26, 2013 @06:00PM (#43285935)

    They are the weakest of the Big 4 and are going all in. I hope it works, if only to keep AT&T / Verizon honest.

  • by tepples (727027) <[moc.liamg] [ta] [selppet]> on Tuesday March 26, 2013 @06:00PM (#43285943) Homepage Journal

    However I am somewhat concerned as I have already seen too many people complain that they'd have to foot the bill for the full cost of the phone. The math would may prove to be difficult for people who are not good at it.

    They could phrase it like this:

    Pay Later: $199 down + $15/month for 24 months
    Pay Now: $549

    The down payment on the Pay Later choice would reasonably match the price with contract on other carriers.

  • Just wait.. (Score:4, Insightful)

    by synthesizerpatel (1210598) on Tuesday March 26, 2013 @06:01PM (#43285953)

    If they really were thinking about customers, the contract would be a no-penalty cancel-anytime-you-want contract that would lock you in for a specific price for a non-trivial amount of time.

    I'm skeptical and will stick with AT&T out of laziness for a while. Prove me wrong T-Mobile and I'll switch. But even though cellular has been one-sided customer-screwing contracts since the inception of the service - contracts can actually protect _both_ parties if you do them right. No contract == No guarantee.

  • by Intrepid imaginaut (1970940) on Tuesday March 26, 2013 @06:02PM (#43285963)

    Competition, the finest part of capitalism.

  • by Anonymous Coward on Tuesday March 26, 2013 @06:06PM (#43285991)

    I second that. Also can someone find the asshat that is posting this shit and BREAK HIS FUCKING LEGS?

    Or, y'know, you could chill the fuck out and ignore him. I browse at 0 all the time (with ACs like me down to -1 by default), and I wouldn't have even seen any trace of this thread if you didn't open your goddamned mouth. Now, thanks to you, there's a post on this thread that started at 1 and that some asshole moderator actually modded UP to 2, leaving an abbreviated message link that points everyone to the damn thread. So yeah. Way to fucking go, dipshit.

  • by It doesn't come easy (695416) * on Tuesday March 26, 2013 @06:09PM (#43286037) Journal
    Let's check out the fine print (is unlimited data really unlimited? etc., etc.) but if T-Mobile is honestly offering unlimited calls, data, tethering, and text without a contract then NOW you can vote with your dollars and switch. If you miss this opportunity to support them on this and send a real message to the other carriers, then you have no right to complain about the state of cell phone service in the US.
  • by Anonymous Coward on Tuesday March 26, 2013 @06:10PM (#43286041)

    I hope the FTC takes note of this. Good things are happening because companies have to innovate to compete instead of take refuge in mega-mergers.

  • by slinches (1540051) on Tuesday March 26, 2013 @06:24PM (#43286187)

    Just checked the plan prices. I compared "unlimited" everything since that's the closest match between features.

    AT&T - unlimited voice $70 + 3GB data $30 + unlimited messaging $20 = $120 per month

    T-Mobile - Unlimited voice, high speed data and messaging $70 + $20 Phone installment plan = $90 per month

    Assuming the down payment on the phone is similar, the T-Mobile plan is ~$700 ($30*24) less over the 2 year AT&T contract. After the phone is paid in full the installment plan ends and saves $50/month over AT&T.

  • Re:They get it (Score:5, Insightful)

    by Anubis IV (1279820) on Tuesday March 26, 2013 @06:34PM (#43286275)

    Agreed. I not-so-fondly recall having to exit my apartment out the back door whenever a call came in (assuming it came in at all), since I couldn't get reliable reception in front of or inside the apartment. And that came after the apartment where I didn't get reception at all and would only find out I had received calls whenever I exited my apartment and had a flood of voicemails suddenly arrive. I dealt with that for three years in the end, and it was a miserable experience the entire time. Strange as it is for me to say it, switching to AT&T was a massive upgrade, and if the experiences I hear recounted to me by others in town who are still with T-Mobile are any indication, AT&T continues to be the better choice for anyone who is actually interested in making calls with their phone.

    And yet, despite that, I'd switch back to T-Mobile in a heartbeat if I thought their coverage had improved, just because I'm so fed up with the usurious pricing schemes that the majority of carriers are engaging in. Even though I have no plans to switch at this time, I laud their decision to make this change to their pricing. If they can extend their coverage or force their competitors to adopt similar plans, I'll be a very happy guy, one way or the other.

  • Re:They get it (Score:4, Insightful)

    by mike449 (238450) on Tuesday March 26, 2013 @06:34PM (#43286279)

    The price is still fairly steep. $50/month for unlimited talk + 500MB of data.
    Data only is $20 for 500MB, $30 for 2GB, and it quickly goes up.
    The fact that these plans are reasonable and attractive tells a lot about the "competition" landscape in the US.

  • by jfern (115937) on Tuesday March 26, 2013 @06:35PM (#43286287)

    Of course having competition requires good regulations. There would be a lot less competition here if the Justice department hadn't successfully blocked AT&T's purchase of T-Mobile.

  • Re:They get it (Score:2, Insightful)

    by CohibaVancouver (864662) on Tuesday March 26, 2013 @06:44PM (#43286355)

    Sounds like a company that is going to pick up a lot of customers very quickly.

    Not so sure... Imagine if Telus followed a similar pattern -

    Customer: How much for a 32 gig iPhone?
    Telus: $800
    Customer: EIGHT HUNDRED DOLLARS??!! It's only $150 at Rogers!
    Telus: Yes, but that price is subsidized.
    Customer: What does "subsidized" mean?
    Telus: Sigh.
    Customer: Bye, I'm heading to Rogers.

  • Banks (Score:4, Insightful)

    by robmv (855035) on Tuesday March 26, 2013 @06:46PM (#43286361)

    Is not it the job of banks to lend money? Use your credit card to finance your purchase. If you have no financial credit and you don't have a credit card, why are you buying expensive gadgets?, buy a simple phone because obviously you should not be wasting money on them

  • by AlphaWolf_HK (692722) on Tuesday March 26, 2013 @06:48PM (#43286387)

    I wouldn't say so. Local regulations and permit procedures are what stop a lot of broadband deployments. Google chose KC for their fiber largely because of the lack of regulation. FIOS deployment has already halted largely due to regulations.

    The regulatory cost puts a heavy thumb on the side of the scale that discourages investment. Indeed, as fellow Forbes contributor Elise Ackerman pointed out last week, Google has explicitly said that part of what made Kansas City attractive was the lack of excessive infrastructure regulation, and the willingness and ability of the city to waive or otherwise expedite the requirements that were on the books.(Despite the city’s promises to bend over backwards for the project, she notes, there have still been expensive regulatory delays that promoted no public values.)

    http://larrydownes.com/what-google-fiber-gig-u-and-us-ignite-teach-us-about-the-painful-cost-of-legacy-regulation/ [larrydownes.com]

    Also, capitalism did to microsoft what the government could not: It broke internet explorer's stranglehold on the web, and microsoft's monopoly on the desktop space is quickly falling apart. Although the EU regulations are more stringent, they couldn't get consumers to ultimately decide to switch to another browser when given the choice, until the likes of Firefox and Chrome became what they are today. They also can't get consumers to decide to buy Windows N instead of the non-N editions. Microsoft is annoyed (and rightly so) that they have to keep a separate SKU for it, even while nobody buys it anyways.

  • by bored (40072) on Tuesday March 26, 2013 @07:06PM (#43286585)

    Utterly wrong, and ignorant of the very definition of "competition". Usually regulation works to PREVENT competition by helping a large entity prevent smaller competitors from succeeding.

    Maybe, i'm feeding the troll here, but its pretty much impossible to study business/economics and not discover abuse of monopoly power, price fixing, collusion, and dozens of other practices that are outlawed because they allow a larger competitor to simply crush any upstarts. The GP is right, competition requires regulation to assure a level playing field. That regulation can be used to lock upstarts out of a field is just another case of monopoly abuse. The wierd thing is that there is plenty of "regulations" that could be repealed (see real-estate agents/broker laws for example) but that isn't the regulation that is being repealed. Instead its regulation to assure that I can't dump toxic sludge into the local creek thereby shifting a cost of business onto society.

  • by alexander_686 (957440) on Tuesday March 26, 2013 @07:30PM (#43286749)

    To expand on what bored is saying.

    Regulation can be used to restrict competition to the insiders. Real Estate is a good example. Most states require licensed realtors to offer Cadillac services – which means nobody offers a striped down version – which is why commissions are uniformly high.

    On the other hand, regulation can be used to bring down the barriers to entry – see the internet. Telecom firms were required to wire up and transmit data regardless of who provided the equipment or services. Regulation helps when one side/group has a significant edge over consumers or other outside producers.

    So regulation is neither good nor bad – it is how it used. (FYI, I prefer less regulation then more)

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